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Q&A: "I'm Recently Retired and Thinking About Cashing in a Portion of my Retirement Savings to Pay Off Credit Card Debt. Is this a Good Idea?"

Question and background: I'm recently retired and thinking about cashing in a portion of my retirement savings to pay off credit card debt. Is this a good idea? I am 63 and was laid off last year. I decided to take early retirement instead of finding another job. I have accrued approx. $304,000 for retirement made up of 401ks, a block of stock from previous employer, and a tiny pension. The only thing I owe is on a credit card - $19,000. In a few days I will receive $1,700 per month, before taxes, of SS. FYI -- support system is a husband who is retired getting $2,500 a month of various income and about $16,000 credit debt of his own. Other than living expenses, we owe nothing else. Q: My block of stock is worth about the same amount as my credit card debt of $19,000. Would it be advisable to sell the stock to pay off my credit card debt? My pension amount is also about the same amount.

Retirement Accounts Social Security Tax

Q&A: "I'm Changing Jobs Soon and my Wife is Thinking of Retiring in the Near Future. Should we Pull Money out of my 401(k) to Pay Down the Remaining Balance on our Mortgage?"

Question and background: I am married 58 years old, my wife is 55. We are both nurses in Alabama, We earn about $94,000 a year. I am about to change jobs after 27 years, my wife may not be able to work too much longer. We currently owe approx. $34,000 on our mortgage. In my 401k plan I have about $150,000. My next job will not allow me to put anything into a 401k plan until after I have been employed for one year. If I remain healthy, I plan to work several more years. My question: Should I withdraw enough money to pay off my mortgage? And what should I do with the remaining?

Retirement Accounts Tax

Q&A: "I'm About to Turn 65 and Have $400K in an IRA, Plus a Couple of Pensions and Social Security. How Much Can I Draw Down on the IRA to Last Until I Am 90?"

Question and background: I'm just about to turn 65 and have not worked for just over two years. I have about $400K in an IRA in addition to a couple of pensions and social security. How much can I draw down on the IRA to last until I am 90? I am drawing from two different pensions of $800 and $2000 per month. I am about to start taking Social Security of about $2300 gross. My wife is still working and will be for another year. She earns $12-20K per year. Is 90 a bit optimistic? Yes, but family history says plan on it.

Retirement Accounts Retirement Income Social Security Tax

Q&A: "I Have a 401(k) that I Would Like to Convert to a Roth IRA and Have a Few Questions."

Question and background: I have a 401k that I would like to convert to a Roth IRA. The amount is around $85,000. I have a few questions: Can I convert the entire amount at one time? If so will I owe taxes on the entire amount at my current tax rate? Can I pay the taxes out of the money that is being rolled over? How do I determine the conversion amount for my basis? Can I then withdraw the converted amount and avoid the 10% penalty since I will not owe taxes on the converted amount that is withdrawn?

Retirement Accounts Tax